Morison and Repatriation Commission - [2000] AATA 528

DECISION AND REASONS FOR DECISION [2000] AATA 528

ADMINISTRATIVE APPEALS TRIBUNAL )

) No N1999/1638

VETERANS' APPEALS DIVISION       )
           Re      MARTIN MORISON
  Applicant

And REPATRIATION COMMISSION
Respondent

DECISION

Tribunal Senior Member M D Allen

Date30 June 2000
PlaceSydney

Decision The decision under review is set aside and in lieu thereof the Tribunal substitutes its decision, namely THAT: the Applicant, Martin Morison, is entitled to pension at the Special Rate pursuant to section 24 of the Veterans' Entitlements Act 1986 (as amended) as and from 1 June 1999.

(Sgd)                  M D ALLEN
  ..............................................
  Senior Member
CATCHWORDS

VETERANS' ENTITLEMENTS - Special Rate pension. Whether Applicant capable of more than 8 hours work per week. Undertaking of risk producing activities not evidence of an ability to attract an employer. Investment income not relevant.

Veterans' Entitlements Act 1986 - subss23(1), 24(1), 24(2) and 120(4)

REASONS FOR DECISION

30 June 2000 Senior Member M D Allen

By application lodged with the Tribunal on 29 October 1999 the Applicant sought review of a decision of the Respondent, as affirmed by a Veterans' Review Board on 10 September 1999, that continued pension at 100% of the General Rate.
The Applicant has the following conditions accepted as being due to his Defence Service, namely sensorineural deafness, cervical sprain, sprung back, gastro-oesophageal reflux, migraine, otitis externa, carpal tunnel syndrome, hypertension and osteoarthrosis of the right knee. A list of symptoms is stated in the documents prepared for the Tribunal pursuant to section 37 of the Administrative Appeals Tribunal Act 1975 as being non-accepted disabilities but, in reality, this list of symptoms represents no more than manifestations of the accepted disabilities.
On 18 May 1999, in a consent decision, the Administrative Appeals Tribunal determined that the Applicant's hypertension was an accepted disability for the purposes of the Veterans' Entitlements Act 1986 (the VEA) and continued pension at the Intermediate Rate. Pension at the Intermediate Rate, pursuant to s23 of the VEA, had been granted with effect from 29 May 1995. There are no documents before the Tribunal, either in this matter or in matter N1998/840, which concern the Applicant's hypertension, which reproduce the original decision granting pension at the Intermediate Rate. A decision of a Veterans' Review Board on 1 February 1999 (T22 at p106) makes reference to a decision at folio 456 of the Department of Veterans' Affairs "M" file. Suffice it to say, however, that at all material times the Applicant was in receipt of pension in excess of 70% of the General Rate of pension.
As the Applicant was under the age of 65 years when he made his claim for pension at the Special Rate, the criteria for the grant of pension at that rate are set forth in subss24(1) and (2) of the VEA, namely:
"24 (1) This section applies to a veteran if:
(aa)the veteran has made a claim under section 14 for a pension, or an application under section 15 for an increase in the rate of the pension that he or she is receiving; and
(aab)the veteran had not yet turned 65 when the claim or application was made; and
(a) either:
the degree of incapacity of the veteran from war-caused injury or war-caused disease, or both, is determined under section 21A to be at least 70% or has been so determined by a determination that is in force; or
the veteran is, because he or she has suffered or is suffering from pulmonary tuberculosis, receiving or entitled to receive a pension at the general rate; and
(b)the veteran is totally and permanently incapacitated, that is to say, the veteran's incapacity from war-caused injury or war-caused disease, or both, is of such a nature as, of itself alone, to render the veteran incapable of undertaking remunerative work for periods aggregating more than 8 hours per week; and
(c)the veteran is, by reason of incapacity from that war-caused injury or war-caused disease, or both, alone, prevented from continuing to undertake remunerative work that the veteran was undertaking and is, by reason thereof, suffering a loss of salary or wages, or of earnings on his or her own account, that the veteran would not be suffering if the veteran were free of that incapacity; and
(d) section 25 does not apply to the veteran.
(2) For the purpose of paragraph (1)(c):
(a)a veteran who is incapacitated from war-caused injury or war-caused disease, or both, shall not be taken to be suffering a loss of salary or wages, or of earnings on his or her own account, by reason of that incapacity if:
the veteran has ceased to engage in remunerative work for reasons other than his or her incapacity from that war-caused injury or war-caused disease, or both; or
the veteran is incapacitated, or prevented, from engaging in remunerative work for some other reason; and
where a veteran, not being a veteran who has attained the age of 65 years, who has not been engaged in remunerative work satisfies the Commission that he or she has been genuinely seeking to engage in remunerative work, that he or she would, but for that incapacity, be continuing so to seek to engage in remunerative work and that that incapacity is the substantial cause of his or her inability to obtain remunerative work in which to engage, the veteran shall be treated as having been prevented by reason of that incapacity from continuing to undertake remunerative work that the veteran was undertaking."

The criteria for the grant of pension at the Intermediate Rate are similar except that inability to undertake remunerative work must be for 20 or more hours per week – that is to say, if a Veteran can undertake more than 8 but 20 or less hours of remunerative work per week pension is payable at the Intermediate Rate.

The Applicant's original claim was made on 6 March 1998. As at that date pension was being paid at the Intermediate Rate, it can be assumed that the Respondent was satisfied that the Applicant was suffering a loss of salary or wages or earnings on his own account because of incapacity from defence-caused injuries or diseases which incapacity alone rendered him incapable of undertaking remunerative work otherwise than on a part-time basis or intermittently not exceeding 20 hours per week. See subs23(1) of the VEA.
In a report to the Respondent dated 2 April 1999 (T24 pp123-128) Dr Mark Burns, Occupational Physician, stated:
"In conclusion, I believe that his service related disabilities of back and neck pain, as well as his migraine and his bilateral carpal tunnel syndrome, are the substantial cause for his inability to work either as a motor mechanic or to be self employed in small business. I believe that he is currently unable to work even eight hours per week due to these conditions."

In a previous report dated 27 October 1996, Dr Burns had opined (T24 pp114-118):

"With respect to employability, I believe that it would not be possible for Mr Morison to return to work as a Motor Mechanic. Certainly his back and neck problems would give him some difficulty in this area. As well as his back and neck problems, though, his bilateral carpal tunnel syndrome would restrict his ability to do work as a Motor Mechanic.
With respect to his being employed in a small business, I think the major difficulty is that he cannot carry out physical activity to any extent. He is unable to spend long hours at a business due to his regular migraines. He could only work in an administrative capacity where he was able to take time off as required. ….
In conclusion, I believe that his service related disabilities of back and neck pain as well as his migraine are a substantial cause of his inability to work either as a Motor Mechanic or to be self-employed in a small business. Certainly his bilateral carpal tunnel syndrome would also restrict his employability, but I feel that it is not nearly as significant as his service related problems."

And on 20 October 1998, Dr Burns had written (T24 pp121-122):

"He would certainly not be able to work for 20 hours per week and it is doubtful that he would cope with even 8 hours per week taking into account the frequency and severity of his migraines."

Exhibit A2 is a report dated 30 April 2000 by Dr Baz, Occupational Physician. At page 5 of that report she opines:
"In my opinion Mr Morison has been unable to continue at work because of the adverse effects of the migraine headaches, and the attendant need for repeated and unpredictable sick leave, which has impacted on the financial viability of his business. His unreliability would be unacceptable to his clients and customers and, if he were to attempt to find work in a paid capacity, would be unacceptable to a potential employer. Although he may have 2 or 3 days a week free of migraine headaches, this is unpredictable. He cannot attend regularly, either as an employer, or to attend to his own customers' requirements. He would not be a productive employee for his employer and would be unable to maintain a financially viable business if providing a service to customers.
In my opinion it would not be practical for Mr Morison to work more than 8 hours weekly."

Given those reports, particularly the report of Dr Mark Burns to the Respondent on 2 April 1999, it might well have been confidently expected that the Respondent would concede that the Applicant was entitled to pension at the Special Rate. However in these proceedings the Respondent attempted to discredit the reports of its own expert as well as the Applicant's expert, by concentrating on a sea voyage made by the Applicant on his boat and by an analysis of his taxation returns, to show he had a residual capacity to engage in some remunerative activity. The Respondent's counsel also argued that the Applicant's failure to continue in remunerative work was as a result of bad business practices and not illness.
After discharge from the Army the Applicant had established himself and his family in Mackay, North Queensland, where he conducted a sail making and repair business. Eventually his accountant recommended that he set up a family trust and incorporate his business activities. The trust then owned the premises in which the business was carried on and later the actual business and business name were sold. The trust still owns the former commercial premises in Mackay which are at present untenanted.
Because of marital difficulties the Applicant's wife left Mackay and moved to Nelson Bay. The Applicant reconciled with his wife and also took up residence in Nelson Bay. He then purchased a photocopying business in Maitland. After initial difficulties, due largely to an unsuitable site, the Applicant reorganised and relocated this business and it prospered. He was forced to sell this business because of his frequent migraine headaches. The sale of the business was recommended by the Applicant's general practitioner and the specialist whom he consulted at John Hunter Hospital regarding his migraines.
Subsequent to the sale of the photocopying business, the Applicant purchased an amusement machine business which he conducted from Nelson Bay. In evidence he stated that he thought that the more casual hours afforded by this business would settle better into his ability to do work. He was still getting frequent headaches but thought he would be able to "juggle" the work.
Prior to purchasing the amusement machine business, the Applicant had made some enquiries regarding work in the Nelson Bay area. At Document T18 page 94 there is a letter from the Nelson Bay CES which reads:
"This is to certify that during the period 10/9/1997 to 14/1/1998 (current), Mr Morison has been registered with this office and has attended the office regularly with a view to seeking work. During this period he has not been able to obtain suitable work.
Of course I am not able to comment on the extent of Mr. Morison's disabilities. However the labour market in the Port Stephens area is a (sic) very competitive and in the area of Mr Morison's expertise he would find it very difficult to compete with able-bodied candidates due to the stated medical conditions from occupational physicians."

It would appear that the Applicant obtained that letter for Veterans' Review Board proceedings after it had been suggested to him that to qualify for the Special Rate he would have to show evidence of having looked for work.

Initially the amusement machine business went well. The Applicant found, however, that because of his migraine headaches he was unable to offer his customers any continuity or reliability of service. He began to lose business as other amusement machine owners would convince site owners that they not only had better machines but that they could provide a better standard of service.
In conjunction with his amusement machine business the Applicant also undertook studies at the local Institute of Technical and Further Education (TAFE) in electronics. The Applicant had done some electronics in the Army and thought that he would be able to repair the machines he had in his business. Some repairs were beyond him, therefore he decided to undertake the TAFE course in electronics. He found that most afternoons of the course he would go home with a headache and, although he completed one "module", he considered it was pointless trying to continue as the course became "harder and harder".
The Respondent submitted that the failure of the Applicant's amusement machine business was due to his involvement in the electronics course and that if he had spent the time he had at the course attending to his business, it would not have failed. I have no doubt that in retrospect this is correct but, in the context of an ongoing venture, being wise after the event does not detract from the then causes and the cause of his being unable to attend to his business was his migraine headaches whether they were caused by study or were spontaneous.
The Respondent also submitted that the evidence showed that the amusement machine business failed because the Applicant, in July 1999, undertook a lengthy sea voyage and in effect abandoned the business.
In evidence the Applicant stated that towards the end of 1998 his marriage suffered an irretrievable breakdown and subsequent divorce. As a result he purchased and started to live on his motor sailer "MS Kestrel" (see Exhibit A4). His evidence was, however, that even before this the amusement machine business was running at a loss due to his inability to attend to it properly, that inability being caused by his migraines.
Cross-examination of the Applicant by the Respondent's counsel was directed to showing that the Applicant's ability to sail his craft "MS Kestrel" to Mackay and return was inconsistent with an inability to undertake remunerative work. Dr Baz was also cross-examined on this point but stated that she was not surprised by the Applicant undertaking a sea voyage although it was inconsistent with all of his incapacities. The voyage would have no effect on his migraines but did seem inconsistent with his neck disability and carpal tunnel syndrome. What was not put to Dr Baz was the effect mechanical devices on the boat may have had, for example the Applicant had stated that sails are raised and lowered by motors.
The fact of the boat journey was put to Dr Baz in evidence in chief and she stated unequivocally that she would not change her opinion, that the Applicant was unable to work more than 8 hours per week, on the basis of the boat journey. She considered that the Applicant's inability to undertake remunerative work was due to his migraines and that what in fact was stopping the Applicant from working was his inability to regularly attend any work undertaken.
Dr Baz also pointed out that in her report she had stated that the Applicant had undertaken a coxswain's course in 1994 with the intention of taking people to dive spots but realised that this would be unsafe because of the risk of developing a migraine headache during a dive.
The Applicant's evidence as to the sea voyage was that he made short journeys from port to port up the coast. At some ports he stayed for days and he was never at sea for more than 7 or 8 hours. The vessel has all modern navigational aids and, if he does suffer a migraine whilst at sea, all he can do is put his head down, put the vessel onto automatic pilot and trust in his navigation aids to alert him to any danger.
In my opinion the Applicant is indulging in a risky activity in undertaking a sea voyage alone when he knows he could be incapacitated by a migraine headache. This no doubt is foolish behaviour on his part but, as stated, his vessel has all modern navigational aids. If he wishes to take such risks then this is a matter for him. A person who suffers from migraine headaches cannot be expected to sit in seclusion at home on the off chance that an attack might occur. This is, however, a different concept from the ability to attract an employer and/or keep employment if obtained.
The Applicant was also cross-examined regarding his tax returns and the returns of the family trust. In evaluating this cross-examination, I had to remind myself that questions are not evidence unless the propositions being put are agreed to by the witness.
Some of the amounts claimed for vehicle use in the returns seem excessive. The returns were drawn up by the accountant to the Applicant and to the trustee company and, whereas that accountant no doubt acted upon figures supplied to him by the Applicant, the cross-examination of the Applicant did not satisfy me that the returns evidenced any activity by the Applicant which could be taken as demonstrating an ability to undertake remunerative work for periods aggregating more than 8 hours per week. The Respondent had sought the Applicant's taxation returns but did not call the Applicant's accountant to explain them or the basis on which they were prepared.
The Applicant conceded that on occasions he had driven long distances. I have no doubt that if not disabled by a migraine headache he can undertake this activity if necessary. He had complained to Dr Baz that he could drive a car although numbness in the hands is more pronounced with prolonged driving. This is not inconsistent with the Applicant's evidence to the Tribunal and his tax returns. Nor is it inconsistent with the history taken by Dr Burns that the Applicant is capable of driving a car but now only does so for short distances. As stated above, both Drs Burns and Baz implicate migraine headaches and their frequency as the cause of the Applicant's inability to work.
Paragraph 24(1)(c) of the VEA requires that the Applicant must be suffering a loss of salary or wages or earnings on his own account. The Respondent pointed out that the earnings of the trustee company had in fact increased since the Applicant ceased work. The income of the trustee company is derived from investments in real estate. It is not inconsistent with an inability to work 8 hours a week for a veteran to be able to spend some time in the week organising his finances. For example, a veteran would still be entitled to a Special Rate pension even though he consulted the daily newspapers regarding share movements and then telephoned his stockbroker so long as his activity did not exceed 8 hours per week. Paragraph 24(1)(b) simply states that the inability must be to undertake remunerative work "for periods aggregating more than 8 hours per week".
In this matter there is no evidence sufficient to satisfy me that the Applicant has so involved himself in the business activities carried on by the trustee company that he can be said to be undertaking work aggregating 8 hours per week or more.

As stated above, the reports of the two occupational physicians who have examined the Applicant are unanimous in stating that he is incapable of undertaking 8 hours remunerative work a week because of his accepted disabilities alone. Despite the attack on the Applicant's credibility by the Respondent and the other matters suggested by the Respondent to be sufficient to negative the standard of my reasonable satisfaction as to the Applicant's case, I am satisfied on the balance of probabilities that the criteria set forth in subs24(1) of the VEA have been met and that the Applicant is entitled to pension at the Special Rate as and from 1 June 1999, that date being fixed as the evidence was that the amusement machine business ceased in May 1999.
The decision of the Respondent will be set aside and in lieu thereof the Tribunal substitutes its decision, namely that the Applicant is entitled to Special Rate pension as and from 1 June 1999.

I certify that the 29 preceding paragraphs are a true copy of the reasons for the decision herein of:
Senior Member M D Allen
Signed: Ivanka Mamic
...................................................................................
Associate

Date/s of Hearing  15 June 2000
Date of Decision  30 June 2000
Solicitor for the Applicant                Mr B Winship, Rockliffs
Counsel for the Respondent          Miss R M Henderson
Solicitor for the Respondent          Australian Government Solicitor